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PNC Financial 2026 NII Outlook Brightens: What's Driving the Momentum?
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Key Takeaways
PNC raised its 2026 NII growth outlook to 15-15.5% on strong Q2 momentum.
PNC lifted its 2026 average loan growth forecast to 12.5%, led by commercial lending.
A better deposit mix and higher-yielding securities are supporting PNC's spread income outlook.
The PNC Financial Services Group, Inc.’s (PNC - Free Report) net interest income (NII) outlook for 2026 has strengthened, supported by robust loan growth, an improving deposit mix and continued repricing of fixed-rate assets. Following the solid second-quarter results, management raised its full-year NII growth guidance to 15-15.5% from the earlier mentioned 14.5%, based on the 2025 NII baseline of $14.41 billion.
PNC’s second-quarter performance highlights the momentum behind the improved outlook. NII reached $4.11 billion, increasing 16% year over year. The net interest margin (NIM) also moved up to 2.96% from 2.95% in the preceding quarter and 2.80% a year earlier.
A key driver is strong loan growth, particularly in commercial and industrial lending. Average loans rose 4% sequentially and 13% year over year to $363.2 billion in the second quarter. Management consequently raised its 2026 average loan growth forecast to 12.5% from 11%.
Deposit trends are another tailwind. While total average deposits were essentially stable sequentially, non-interest-bearing deposits increased 4%, while the rate paid on interest-bearing deposits declined five basis points. This favorable shift in funding mix is helping offset pressure from lower loan yields and supporting spread income. PNC should also benefit from fixed-rate asset repricing. During the second quarter, the company sold roughly $4 billion of securities and reinvested the proceeds into securities yielding about 120 basis points more, enhancing the prospective earnings contribution from the investment portfolio.
The FirstBank acquisition has expanded PNC’s loan and deposit base. The transaction added roughly $16 billion in loans and $23 billion in deposits at closing, providing additional scale and opportunities to deepen customer relationships.
Near-term momentum remains encouraging, with management expecting third-quarter NII to increase 3-3.5% sequentially. Overall, robust commercial lending, a healthier funding mix and asset repricing appear well-positioned to keep PNC’s NII trajectory positive through the remainder of 2026, though elevated expenses and funding needs remain factors to watch.
Wells Fargo expects NII to be $50 billion. NII excluding Markets is projected to be $48 billion, driven by balance-sheet growth, a favorable loan and deposit mix and continued fixed-asset repricing, partially offset by the impacts of expected rate cuts.
Citigroup expects NII (excluding Markets) to increase 5-6% on a year-over-year basis in 2026, supported by stabilizing deposit costs and disciplined balance-sheet management. The outlook reflects the bank’s efforts to benefit from a more favorable rate and funding environment while continuing to reshape its business toward higher-quality growth.
PNC Financial Price Performance & Zacks Rank
Shares of PNC have surged 31.4% over the past year compared with the industry’s growth of 26.3%.
View the Zacks #1 Rank List
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PNC Financial 2026 NII Outlook Brightens: What's Driving the Momentum?
Key Takeaways
The PNC Financial Services Group, Inc.’s (PNC - Free Report) net interest income (NII) outlook for 2026 has strengthened, supported by robust loan growth, an improving deposit mix and continued repricing of fixed-rate assets. Following the solid second-quarter results, management raised its full-year NII growth guidance to 15-15.5% from the earlier mentioned 14.5%, based on the 2025 NII baseline of $14.41 billion.
PNC’s second-quarter performance highlights the momentum behind the improved outlook. NII reached $4.11 billion, increasing 16% year over year. The net interest margin (NIM) also moved up to 2.96% from 2.95% in the preceding quarter and 2.80% a year earlier.
A key driver is strong loan growth, particularly in commercial and industrial lending. Average loans rose 4% sequentially and 13% year over year to $363.2 billion in the second quarter. Management consequently raised its 2026 average loan growth forecast to 12.5% from 11%.
Deposit trends are another tailwind. While total average deposits were essentially stable sequentially, non-interest-bearing deposits increased 4%, while the rate paid on interest-bearing deposits declined five basis points. This favorable shift in funding mix is helping offset pressure from lower loan yields and supporting spread income. PNC should also benefit from fixed-rate asset repricing. During the second quarter, the company sold roughly $4 billion of securities and reinvested the proceeds into securities yielding about 120 basis points more, enhancing the prospective earnings contribution from the investment portfolio.
The FirstBank acquisition has expanded PNC’s loan and deposit base. The transaction added roughly $16 billion in loans and $23 billion in deposits at closing, providing additional scale and opportunities to deepen customer relationships.
Near-term momentum remains encouraging, with management expecting third-quarter NII to increase 3-3.5% sequentially. Overall, robust commercial lending, a healthier funding mix and asset repricing appear well-positioned to keep PNC’s NII trajectory positive through the remainder of 2026, though elevated expenses and funding needs remain factors to watch.
PNC’s Peers 2026 Expectations
Wells Fargo (WFC - Free Report) and Citigroup (C - Free Report) also expect their NII to grow in 2026.
Wells Fargo expects NII to be $50 billion. NII excluding Markets is projected to be $48 billion, driven by balance-sheet growth, a favorable loan and deposit mix and continued fixed-asset repricing, partially offset by the impacts of expected rate cuts.
Citigroup expects NII (excluding Markets) to increase 5-6% on a year-over-year basis in 2026, supported by stabilizing deposit costs and disciplined balance-sheet management. The outlook reflects the bank’s efforts to benefit from a more favorable rate and funding environment while continuing to reshape its business toward higher-quality growth.
PNC Financial Price Performance & Zacks Rank
Shares of PNC have surged 31.4% over the past year compared with the industry’s growth of 26.3%.
Price Performance
Image Source: Zacks Investment Research
Currently, PNC Financial carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.